Asda, Morrisons, Sainsbury's and Tesco continue their fuel price war by cutting diesel’s price, and it could fall as low as 90p per litre this year
Matt Burt
4 January 2016

The price of a litre of diesel in the UK has fallen to its lowest rate since May 2009, prompted by fierce supermarket competition, and motoring organisations predict it could drop to as low as 90p per litre this year.

Asda, Sainsbury’s and Tesco all followed the example set by Morrisons by bringing its diesel price below £1 per litre. As of Monday 4 January Morrisons, Asda and Tesco have all set the price at 99.7p, whereas Sainsbury’s is charging 99.9p.

The diesel price drop follows last month’s reduction in the price of a litre of petrol across the forecourts of the supermarket chains, a decrease that was prompted by the falling price of crude oil around the world.

The RAC has calculated that for diesel car drivers with a fuel tank of around 55 litres, filling up will cost more than £10 less than it did in January 2015. What’s more, the organisation predicts that further price falls are possible during 2016.

“About 75% of the price of a litre of fuel goes to the Treasury in duty and VAT,” said RAC Fuel Watch spokesman Pete Williams. "The rest of the price is production, refinery costs, distribution and the fuel retailer's margin. This means that there is a limit to how low we will see the price of diesel and petrol go, but prices could well continue to fall and a pump price of as low as 90p a litre is not that far fetched.

“Saudi Arabia has also reiterated its intention not to cut oil production so the world will continue to be awash with oil because demand is also down, suggesting that sustained lower petrol and diesel prices are going to be around for much of 2016.”

Williams said the UK’s 11 million diesel drivers would welcome the move by the big supermarkets. “The wholesale price of diesel has been around two pence cheaper than the wholesale price of petrol since a couple of weeks before Christmas, so we should have seen these cuts earlier and that is what the RAC has been calling for," he added.

“We hope that other supermarkets and the cheaper fuel retailers will follow suit swiftly and do the right thing for motorists. This should reduce the average price of diesel across the UK for motorists everywhere who can then benefit from the low price of crude oil on the world commodity market.

“This is great news for consumers and motorists generally for whom the cost of motoring is one of their biggest gripes. But it will also benefit UK business, which runs on diesel, and should be a further stimulus to the economy.”

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4 January 2016
Except perhaps for the environment, and maybe a few manufacturers trying to sell electric cars!

4 January 2016
that really gets my back up. Like the cost of the product has been fairly calculated by taking many parameters into consideration, and yet, hey presto, 109.9, 104.9, 139.9, 99.9...what a total load of.......

5 January 2016
Does anyone find that their car doesn't work as well on supermarket fuel? I found it makes my Golf's fuel pump whine and the car doesn't feel as perky. I read elsewhere that supermarkets put in half the additives by percentage of content compared to branded fuel companies. The base petrol or diesel is the same. Seeing that these additives clean and lubricate the engine and fuel supply components, I decided to never touch supermarket fuels, no matter what the price. Or maybe its just my car? I didn't notice a difference with my old Honda.

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